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Proposal: Admin - HR Consult

Ryan Taylor

Well-known member
Foundation Member
This is a cross-post from www.dashcentral.org/p/admin-hr-avt-201702

This proposal funds a third-party assessment of our organization's HR processes in order to help Dash transition into a more sustainable operation.

Why is this needed?

When Dash's funding model was introduced in August of 2015, the budget was a small fraction of its current size. The "Core Team Salaries" budget was created at that time with the intent of providing a small "thank you" for contributions to the team. At that time, the budget was split evenly among the main contributors to the project.

As the price of Dash continued to rise, this monthly pool of funds gradually became sizable, and became increasingly more than a "thank you". By the middle of 2016, some less-involved contributors were beginning to receive sizable pay when evaluated on an hourly basis. Meanwhile, there was little incentive for contributors to increase their contributions, as their compensation was unaffected by their hours or responsibilities. It was clear that the network's funds were not being optimized for the most impact, so we began evaluating tiered payment options to provide this incentive.

In addition, as we began growing, it became harder to find the "volunteer-type" resources driven purely by personal passion for the project or sizeable personal investments, and we started hiring higher-pay developers (still at a discount to market rates, but much more than the rest of the team). As we tapped out these volunteer resources, we nonetheless recognized the need to continue growing the team... even if it meant disparate pay across contributors. We are also entering into longer-term arrangements with some of our proven developers.

As we have accumulated some savings to protect against exchange rate changes, and have much more resources at our disposal, we have the opportunity to make Dash a sustainable employment option for those that have sacrificed to get us where we are today. We have operated far too long in a situation in which newcomers have been paid substantially more than long-time contributors, even if below market rates.

In addition, our HR processes and infrastructure is inadequate for the number of resources involved in the project today. Organizations rarely reach a size of 30 employees without a full-time HR resource, at least not without serious issues cropping up. We currently have 28 paid positions, excluding the many outsourced contributors like our PR firm, and our staff of translators in 5 different languages. Robert Wiecko and I have done our best to manage onboarding, firing, contracts, setting policies, etc. but we are beginning to see signs of strain with the current approach... miscommunications over employment offers, renewal contracts not issued on time, etc.

We have also severed our relationship with a number of team members within the past year, due to performance, availability, behavior or other issues. We need to do more to assess risks ranging from reputational to financial associated with these changes.

Simply put, at our current scale, we need help structuring our approach to HR, and a third-party expert perspective would be especially valuable to help the team with a fair transition.

What are the plans to address the issues?

As an open source project, our HR approach needs to be flexible enough to accommodate a very fluid open organization with limited structure. We feel that a non-standard and lean approach is needed with simple tools and processes in place that will nonetheless prevent HR related issues from occurring.

We have had several discussions with August Venture Talent (AVT) regarding our issues and HR needs, and AVT has proposed a project to help us address our issues and prepare for future growth. The proposed project will address the following six areas that the team identified as our highest priority needs. Note that some areas will receive less focus / attention than others based on the priorities given. Low priority tasks will be addressed on a best-effort basis, and will be completed time permitting.

1) Recruiting (low priority)
• Create role descriptions for anticipated future roles
• Identify potential recruiting sources
• Establish basic recruiting process
• Establish basic recruiting/hiring guidelines

2) Role Definition (high priority)
• Facilitate completion of role description questionnaires for all relevant parties with follow-up conversations as needed for clarification
• Create role description template for current and future use
• Create role descriptions for designated roles

3) Compensation (high priority)
• Guide the Dash team in establishing a framework (including criteria and priorities) for compensation decisions
• Explore/create a basic job evaluation model to compare the relative worth of jobs within the organization (internal equity)
• Create an adjustable basic pay structure that accommodates competitive pay factors and/or geographic cost of living differentials, where feasible
• Possibly devise solution to handle discrepancies between competitive pay factors and internal equity
• Identify differentials for sample geographic locations relevant to Dash
• Examine discrepancies between market rates and current pay and devise plan for gradually closing the gap based on changing availability of resources, taking into account organizational objectives

4) On-boarding (moderate priority)
• Facilitate identification and documentation of onboarding issues and needs
• Suggest and document onboarding processes and responsibilities

5) Performance Evaluation (low priority)
• Identify and document basic standards of performance, identifying any overlap or need for integration with the Dash Core Team Handbook
• Explore potential means of measuring performance and offering feedback in ways appropriate to the current mode of operating in which many members are essentially volunteers
• Facilitate consideration of potential rewards and consequences of performance

6) Firing (moderate priority)
• Determine all implications of severing a relationship with a Core Team member
• Identify potential liability issues and nature of liability (legal, operational, financial, etc.) and determine whether additional input is needed from expert sources
• Create guidelines and process for determining when termination is warranted (in conjunction with guidelines stated in Core Team Handbook)
• Define a process for security access right removal

The timing for this project will require approximately one month to complete and is subject to scheduling a start date with the firm. Because AVT is interested in supporting our project and blockchain is an emerging space of interest to them, they are willing to provide more senior staff at a supplemented / fixed rate for the duration of the engagement.

@fernando Gutierrez will oversee the project with myself in a supporting role. If you have additional questions, please tag @fernando or @babygiraffe in your post to ensure we see your message.

More about AVT and their support for Dash:

Donna White is Managing Partner at AVT and will lead their work. She will be personally performing most of the analytical and evaluative work involved, and will formulate recommendations and guidelines. Her time allotment to the project alone would equate to the entire fee her firm will charge, but we will receive additional support from an associate with AVT with an HR and recruiting background, plus support from other administrative staff. Fees will total $5,000 (fixed) for the full body of work described.

Outcomes:

We believe by addressing these topics now, we can create a far more effective organization that makes the most use of our limited resources. From creating a more productive recruiting process, to getting new members productive quickly, to ensuring we retain talent without overpaying, to managing our HR risks more effectively, we feel that this project can deliver massive value to our network. While we know we can't provide adequate compensation at our current budget levels, we think we can start to address the fairness issues with disparate pay levels and map out a path to closing those gaps as resources become available, and eventually make Dash a far more desirable and stable place to build a career.

Requested funding is as follows for the February 3rd budget cycle:
Total: 360.06 Dash

Note: Any unused funds from this Dash-Evolution development funding will be directed toward other administrative expenses.

Manually vote YES on this proposal:
dash-cli mnbudget vote-many 8adf48c6b1da0272ed6197efedb03c5edd9f0a0ae9522b7c26a923e69bc71f95 yes
OR from the qt console:
mnbudget vote-many 8adf48c6b1da0272ed6197efedb03c5edd9f0a0ae9522b7c26a923e69bc71f95 yes

Manually vote NO on this proposal:
dash-cli mnbudget vote-many 8adf48c6b1da0272ed6197efedb03c5edd9f0a0ae9522b7c26a923e69bc71f95 no
OR from the qt console:
mnbudget vote-many 8adf48c6b1da0272ed6197efedb03c5edd9f0a0ae9522b7c26a923e69bc71f95 no
 
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I don't think I can even express how valuable I think this proposal is to facilitate the growth of the team and efficiency. HR issues can be so sticky and can bog everything down if there's not a really well-developed plan suited to the needs of the project. Vote yes to this thing
 
This is an excellent proposal that can boost up performance of our Core Team. But it also makes Dash becoming less decentralization.

I was wondering if this could benefit for other teams in future who join and provide value added for our ecosystem?
 
I have some doubt about the ability of third-party expert to understand the specifics and peculiarities of our project.
I know that many business owners attract outside experts to manage different important areas of enterprise, but in the same time they have a strict rule: "all HR-questions must be solved internally, only by them, personaly, no third-party experts, who are not able to understand the essence of the project."

Maybe in the DASH-community there are some HR-specialists who could participate in solving these topical and urgent tasks - to make sure we will get recommendations, those are not "theoretical" but would really work for the long term?
 
Supporting but I'm a little concerned the project could become entrenched in a conventional business mindset that could clash with its open source foundations. This is already happening with Bitcoin and it's hard to see a clear path to avoiding it, other high profile open source projects have suffered from the same but some of their hard earned lessons may have something to teach us.
 
This is an excellent proposal that can boost up performance of our Core Team. But it also makes Dash becoming less decentralization.

This is a fair point, and the more Core Team starts to act like a business, the more successful it's likely to be but the more it's going to be charged with "centralization." If you think about it, though, Core Team may be centralized but Dash is not. At any time, the masternode owners could deprive the Core Team of funding and completely emasculate it. The Core Team is more like a property management company that runs and apartment building, and less like the owners of that apartment building. The management team can be voted out at any time by simply stripping funding.

I have some doubt about the ability of third-party expert to understand the specifics and peculiarities of our project.
My mom is Regional Human Resource Manager for a large company, so I have some indirect experience with the nature of HR. While you're correct that an understanding of our project is key to making successful recommendations, the HR field is just as technical in its own right and requires a specialist to truly navigate. Just as an example, I can't tell you how many times my wife's work or mine has done something and mom has said "that's illegal."

There's also a lot of organizational issues at the moment with Core Team. Just as an example, I receive projects from Evan, Ryan, Daniel, Phillipp (tungfa), Robert (kot), and even from community members on occasion. Who is my boss? Whose work do I prioritize first? Who can I tell "no," or "I'll get to it later?" Who has the authority to fire me? Fortunately we have a great team and I've never had any such problems, but as we grow, a clear hierarchy and reporting structure needs to emerge.

Finally, HR can bring tremendous value. My current full time "day job" is a disaster; it's inefficient and is a quite unpleasant work environment. A big part of the problem is poor HR function. Our HR department, for instance, answers directly to the head of one of our business units, rather than to the chief executive. That unfortunately ensures that HR has no independence and little authority here. As a result, personnel issues run amok. You wouldn't believe half the things that go on around here!
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Supporting but I'm a little concerned the project could become entrenched in a conventional business mindset that could clash with its open source foundations. This is already happening with Bitcoin and it's hard to see a clear path to avoiding it, other high profile open source projects have suffered from the same but some of their hard earned lessons may have something to teach us.

I'm not sure about this. Centralization has been the most successful business model the world has ever seen. As a historian I can tell you, for example, that Athenian democracy was a total disaster. It was completely decentralized, but highly ineffective. Popular leaders (demagogues) regularly assumed the reins of government, or had unpopular citizens banished (ostracized). Likewise Rome, when they expelled the kings, sought less centralization and deliberately made their government less efficient by creating numerous checks and balances. This worked for awhile, but eventually centralization reasserted itself with the Principate (imperial era).

The biggest and most successful companies in the world are highly centralized. If there was a significant business advantage to decentralization, somebody would have used it by now. Granted that hierarchies are flattening, but they are still present. I don't think it's a problem for Core Team to become centralized/organized, since that does not require the entire Network to follow along. A rival Core Team could easily be funded by the Network instead, should the current Core Team become unsatisfactory.
 
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I'm not sure about this. Centralization has been the most successful business model the world has ever seen. As a historian I can tell you, for example, that Athenian democracy was a total disaster. It was completely decentralized, but highly ineffective. Popular leaders (demagogues) regularly assumed the reins of government, or had unpopular citizens banished (ostracized). Likewise Rome, when they expelled the kings, sought less centralization and deliberately made their government less efficient by creating numerous checks and balances. This worked for awhile, but eventually centralization reasserted itself with the Principate (imperial era).

The biggest and most successful companies in the world are highly centralized. If there was a significant business advantage to decentralization, somebody would have used it by now. Granted that hierarchies are flattening, but they are still present. I don't think it's a problem for Core Team to become centralized/organized, since that does not require the entire Network to follow along. A rival Core Team could easily be funded by the Network instead, should the current Core Team become unsatisfactory.

There's certainly truth in that but each of those success stories has left a trail of beaten competitors in its wake and choosing to play by those rules puts us in the same arena as the Microsofts, Goldman Sachs, Texacos, a great many companies that have a great wealth of expertise in beating competitors. A DAOs greatest strength is its lack of jurisdiction, it exists in the virtual world and that gives it a major advantage over those predatory giants but choosing to operate in the same way seems like giving up at least part of that advantage.

That's my view anyway but I'm wandering off-topic with it, I'd left that point a bit vague so I'll give an example. Just supposing the Linux project had taken a good hard look at its self back in, say, 2005 and decided to do some streamlining, got in a HR company to analyse the workflow, send out questionnaires, trim out the "dead wood". That project has many thousands of contributors, even I have a bit of code in there (an obscure and semi-obsolete touchscreen driver) and there's no way I'd accept me as part of an efficient and streamlined team so that bit of code and thousands more like it would never have been included. Result, Linux would still be receiving harsh criticism for weak driver support but instead it has by far the best driver support of any OS today. From a HR point of view it's a a godawful inefficient waste of time and resources but from any other it's an outstanding success. Linux and Windows are two different approaches to the same problem but if Linux had chosen to operate as a conventional business Microsoft would have eaten it alive.
 
This doesn't really apply to people who are not paid by the core team who just want to contribute, or to people who are funded from separate proposals. That aspect of decentralization, and being an open source project, remains intact regardless of how the core team manages itself
 
There's certainly truth in that but each of those success stories has left a trail of beaten competitors in its wake and choosing to play by those rules puts us in the same arena as the Microsofts, Goldman Sachs, Texacos, a great many companies that have a great wealth of expertise in beating competitors. A DAOs greatest strength is its lack of jurisdiction, it exists in the virtual world and that gives it a major advantage over those predatory giants but choosing to operate in the same way seems like giving up at least part of that advantage.

I'm not really sure that decentralization immunizes us from market competition. All of those companies succeeded in part by being highly organized. As far as a DAOs enjoying a lack of jurisdiction, that's probably not true. The federal government has enormous power, and if it decides that it wants to do something legally to the Dash DAO, it's not going to be discouraged by petty distinctions. The law does not recognize the concept of a DAO, and if push came to shove, they'd probably just come after Evan and/or the rest of the Core Team. The government tends to "shoot first and ask questions later." Look at Aaron Schwartz...

That's my view anyway but I'm wandering off-topic with it, I'd left that point a bit vague so I'll give an example. Just supposing the Linux project had taken a good hard look at its self back in, say, 2005 and decided to do some streamlining, got in a HR company to analyse the workflow, send out questionnaires, trim out the "dead wood". That project has many thousands of contributors, even I have a bit of code in there (an obscure and semi-obsolete touchscreen driver) and there's no way I'd accept me as part of an efficient and streamlined team so that bit of code and thousands more like it would never have been included. Result, Linux would still be receiving harsh criticism for weak driver support but instead it has by far the best driver support of any OS today. From a HR point of view it's a a godawful inefficient waste of time and resources but from any other it's an outstanding success. Linux and Windows are two different approaches to the same problem but if Linux had chosen to operate as a conventional business Microsoft would have eaten it alive.

Do you believe that Microsoft went easy on Linux because it wasn't a centralized company? I doubt it. Linux has succeeded because it was better at some things than Windows was...its success is the result of competition, not due to a lack of it.

I like that you mentioned Linux though, because it's an excellent example. In that analogy, Dash is like Linux and the Core Team is like a group of Linux contributors who voluntarily self-organized. That doesn't mean the entire project is suddenly centralized--only that particular volunteer group. If some other group of people want to take over development of Dash, they simply have to start submitting budget proposals and competing with Core Team for funding. This hypothetical group could be as centralized or decentralized as it likes--that's not strictly relevant to the currency network itself.
 
I couldn't help thinking of Linus Torvalds response to Nvidias method of integration while I was writing that... ;) Irrelevant of course, Nvidias binary blob is nothing like Dash core development. Red Hat would probably be a more fitting example, they've contributed a huge amount of open source code to Linux and have been extremely successfully in the dog-eat-dog world of business in the process, a mutually beneficial relationship if ever there was one. I was looking for an example of Red Hats relations with open source communities and this passage seems to sum it up nicely:
Red Hat will contribute its resources and expertise in building thriving open source communities to help establish more open project governance, broaden opportunities for participation, and provide new ways for CentOS users and contributors to collaborate on next-generation technologies such as cloud, virtualization, and Software-Defined Networking (SDN).

With Red Hat’s contributions and investment, the CentOS Project will be better able to serve the needs of open source community members who require different or faster-moving components to be integrated with CentOS, expanding on existing efforts to collaborate with open source projects such as OpenStack, Gluster, OpenShift Origin, and oVirt.

Red Hat has worked with the CentOS Project to establish a merit-based open governance model for the CentOS Project, allowing for greater contribution and participation through increased transparency and access.
(from here: https://community.redhat.com/centos-faq/ )

Seems like a sound principle, probably outside the scope of Dashes budget at the mo but it looks like a good example of symbiosis between a streamlined business and a loosely knit open source community.

I wouldn't underestimate just how powerful a distributed project can be though, Microsoft put a lot of resources into challenging Linux from many different angles and failed each time. The last major attempt was on intellectual property grounds via a company called SCO, a seriously big name once but that case put them head to head with IBM and it wiped SCO out completely. They hadn't intended to take on IBM initially but they ran out of options, at first they tried to create a case against all Linux users but that proved an impossible challenge and once they'd set things in motion they couldn't back down. The legal system couldn't help them, millions of users spread out all over the globe... taking on IBM was the soft option and when IBM is your weaker opponent you're pretty much screwed.

SUSE was Microsoft's gateway to charging for a "licensed" version of Linux in the event of SCO winning that case and SUSE lost an awful lot of respect over it, they where just about the top-dog distro before that but no one wanted to know 'em after. SUSE and Red Hat are more or less competitors in the same market these days and SUSE back then reminds me an awful lot of Blockstream today and I don't see SUSE's name in the S&P500 ;)
 
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I have some doubt about the ability of third-party expert to understand the specifics and peculiarities of our project.
I know that many business owners attract outside experts to manage different important areas of enterprise, but in the same time they have a strict rule: "all HR-questions must be solved internally, only by them, personaly, no third-party experts, who are not able to understand the essence of the project."

Maybe in the DASH-community there are some HR-specialists who could participate in solving these topical and urgent tasks - to make sure we will get recommendations, those are not "theoretical" but would really work for the long term?
I'm also sceptic about hiring external experts for anything. I was a consultant for a while in the past and it is amazing how much bullshit a board is willing to buy so they can cover behind an external expert... but as @David has said in another post, HR is quite technical, so someone who's been down this road before should be useful. This is not intended to be an externalization of HR (I'm your business owners, the boss must hire, must fire and must make the ultimate decisions), but a set of tools so we can do HR internally.
 
Supporting but I'm a little concerned the project could become entrenched in a conventional business mindset that could clash with its open source foundations. This is already happening with Bitcoin and it's hard to see a clear path to avoiding it, other high profile open source projects have suffered from the same but some of their hard earned lessons may have something to teach us.
Since we started paying people the dynamics changed, it is only human. A less conventional business mindset sounds great, but if you pay people and ask for results you need some conventions or something will blow up eventually. Anyway, what I hope is that if we define things well enough, we'll be able to accommodate all kind of profiles in the project: the full time pros, the hobbyist and the in-betweens.
 
I'm also sceptic about hiring external experts for anything. I was a consultant for a while in the past and it is amazing how much bullshit a board is willing to buy so they can cover behind an external expert... but as @David has said in another post, HR is quite technical, so someone who's been down this road before should be useful. This is not intended to be an externalization of HR (I'm your business owners, the boss must hire, must fire and must make the ultimate decisions), but a set of tools so we can do HR internally.

I'm actually taking an HR class for my MBA right now and just learned something that exemplifies how complicated/technical HR can be. If one of your employees tells you that a blood relative is sick and you later ask that employee how they are doing, and then at a later date you fire the employee for something, they can sue you for violation of the Genetic Information Discrimination Act. Since a relative was sick, and they share at least some of the relative's genes, and you inquired about the relative's condition, and at some future point you took adverse action against the employee, you're technically in violation of the law.

It's absolutely ridiculous--but it's just that kind of ridiculousness that HR professionals get paid to worry about. Another example--did you know that a person who is overweight is actually protected by the Americans with Disabilities Act? HR is a very weird and arcane field...
 
I'm actually taking an HR class for my MBA right now and just learned something that exemplifies how complicated/technical HR can be. If one of your employees tells you that a blood relative is sick and you later ask that employee how they are doing, and then at a later date you fire the employee for something, they can sue you for violation of the Genetic Information Discrimination Act. Since a relative was sick, and they share at least some of the relative's genes, and you inquired about the relative's condition, and at some future point you took adverse action against the employee, you're technically in violation of the law.

It's absolutely ridiculous--but it's just that kind of ridiculousness that HR professionals get paid to worry about. Another example--did you know that a person who is overweight is actually protected by the Americans with Disabilities Act? HR is a very weird and arcane field...
Yup, you're right that there are all kind of weird regulations in HR. However, the focus of the project is not on the legal part of HR, which is dependent on each jurisdiction and is arguable if applies to our blockchain/DAO/whatever. The project will be focusing more on compensation, roles and procedures. All those will need to be reasonable and respectful, but trying to make them compliant with all HR regulations is simply impossible.
 
Yup, you're right that there are all kind of weird regulations in HR. However, the focus of the project is not on the legal part of HR, which is dependent on each jurisdiction and is arguable if applies to our blockchain/DAO/whatever. The project will be focusing more on compensation, roles and procedures. All those will need to be reasonable and respectful, but trying to make them compliant with all HR regulations is simply impossible.

I understand, I was just using that as an example of how specialized the field is and how important it is to have expert advice. IMO, compensation issues are what kill most companies, so that is going to be a critical one (in the long term).
 
I understand, I was just using that as an example of how specialized the field is and how important it is to have expert advice. IMO, compensation issues are what kill most companies, so that is going to be a critical one (in the long term).
I agree, especially considering that we have very different levels of implication among the team, people are spread around the world and all started as a voluntary effort. Probably there is no way to get it perfect, but we need to have a very good framework.
 
...at any time, the masternode owners could deprive the Core Team of funding and completely emasculate it.

Funniest thing I read all week!! - like yeah, right, that's going to happen! lol

I just love it that you all are digging your own hole deeper and deeper into centralisation.. utterly and wilfully blind to the inevitable backlash. Not satisfied with centralised backup servers? - or a single person switching off rewards to MNs - the US based legal team - or the new offices - or the HR team. You all think that everyone else is stupid and will not ridicule you for buying into centralisation? The government is going to eat you alive and you have yourselves to blame.
 
Since we started paying people the dynamics changed, it is only human. A less conventional business mindset sounds great, but if you pay people and ask for results you need some conventions or something will blow up eventually. Anyway, what I hope is that if we define things well enough, we'll be able to accommodate all kind of profiles in the project: the full time pros, the hobbyist and the in-betweens.

It sounds like a sensible course of action but I do find it a little ironic that a project founded in the most innovative community I've ever come across wants to hire in a company to do innovation. It's a problem that's confounded smart communities before though so maybe it's the best way of getting over that hurdle.
 
The core team's internal compensation model and onboarding/performance HR issues aren't really what they are innovating though. The innovation is all with the tech. Managing a team with volunteers and paid staff, part and full time, with diverse abilities is just the same old challenge faced by many teams/companies that have come before. The team might be among the best in the business when it comes to development, but needs some professional guidance for HR, to come up with a system that meets the needs of this particular project.
 
Insisting on decentralization purism shows inexperience. Cherry pick the aspects of centralization that are good.

While I disagree strongly (did you notice) with many of the things that the "the evil core" do, and how they do it; I hate this a bit less. Because it makes sense. It's a but like putting a cherry on top of a turd, but at least it looks like Ice Cream...

I recall commentary I made back in the early days on BCT regarding Autistic Pick-Up Artists. DASH is such a good fundamental imagining that even morons, as long as they keep hammering, will succeed eventually.

While there is now a very heavy burden of poor decisions, poor governance, and downright retarded wastes of money as a result of both; this is moving back in a direction of being sane and useful. the project has been severely hamstrung and held back for quite a while now. This looks like one tiny step forward after sprinting backwards for nearly a year, but it's something...

A small patch to IX before this long stagnation of re-engineering for 12.1 and the beginning of Evolution could have allowed marketplace progress to proceed instead of the stagnation we've had. The pause had to happen, no doubt, but you picked the absolute worst timing for it that you could have... You really fucked DASH with that failure and the project only manages to survive because other projects fucked up even worse. You cannot do this again.
 
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